Florida East Coast Industries Inc
Florida East Coast Industries — Q4 2006 Earnings Presentation
39 slides from Florida East Coast Industries's earnings presentation, Feb 15, 2007
Slide 1: Fourth Quarter 2006 Earnings Review
February 13, 2007 Florida East Coast Industries, Inc. Fourth Quarter 2006 Earnings Review Exhibit 99.1 February 15, 2007
Slide 2: Company Snapshot
RAILROAD REAL ESTATE Company Snapshot Florida East Coast Industries A Florida Railroad and Real Estate Company > Regional freight railroad that operates 351 miles of main line track with the most direct route from Jacksonville to Miami and provides intermodal drayage services in the Southeast U.S. >
Slide 3: Forward-Looking Statements
Florida East Coast Industries, Inc. Forward-Looking Statements This presentation contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements inclu
Slide 4: Adolfo Henriques, Chairman, President & CEO
FLORIDA EAST COAST INDUSTRIES, INC. Adolfo Henriques Chairman, President & CEO
Slide 5: Overview: 2006 Railway
Overview 2006 Railway • Revenues increased 11% to $264.1 million • Operating profit increased $14.7 million or 23% to $78.5 million Operating profit includes $5.3 million of net insurance recoveries related to 2005 hurricane season • Housing and Automobile Markets softened during second half of 2006
Slide 6: Overview: 2006 Real Estate
Overview 2006 Real Estate • Realty rental revenues increased 13% to $97.4 million • Realty rental operating profit before depreciation & amortization increased $6.9 million, or 12%, to $62.5 million Results include $1.8 million of insurance recoveries, net of expenses, related to 2005 hurricane seas
Slide 7: Overview: Railway 4th Quarter 2006
Overview Railway - 4th Quarter 2006 • Revenues increased 2% to $63.6 million • Operating profit increased $1.1 million or 7% to $17.4 million • Fourth quarter 2005 impacted by hurricane • Slowing residential construction and automobile shipments during the quarter
Slide 8: Railway – Aggregate Volumes and Revenues
Railway – Aggregate Volumes and Revenues • Quarterly aggregate volume down 3% with revenue down 1% • Volume continues to be impacted by residential construction slowdown • Customers continue shift from residential to infrastructure and commercial sectors • Hearings completed on rock mining in South
Slide 9: Railway – Continued Intermodal Revenue Growth
Railway – Continued Intermodal Revenue Growth • Quarterly Intermodal volume up 3% and revenue up 9% • Florida’s shape and growth supports the value proposition of rail transportation • Rail provides a direct, more cost- effective transportation solution • Florida is an international hub • Exclusive
Slide 10: Railway Outlook
Railway Outlook • Florida continues to be one of the fastest growing states in the US • Expectations for soft residential market to be offset by higher commercial and infrastructure volumes Residential construction market expected to improve in second-half of 2007 • Decreased domestic manufacturers
Slide 11: Flagler Development Group
Flagler Development Group Lakeside Two – Flagler Center
Slide 12: Overview: Real Estate 4th Quarter 2006
Overview Real Estate – th Quarter 2006 • Realty rental revenues increased 14% to $25.8 million • Realty rental operating profit before depreciation & amortization increased 9%, to $15.6 million • Realty services revenues were $16.0 million with $1.8 million in operating profit
Slide 13: Flagler Development Pipeline
Flagler Development Pipeline • Overall Occupancy: 96% • 485,000 square feet in lease-up 64% leased • 1.9 million square feet under construction • 1.9 million square feet in pre-development
Slide 14: Flagler Development Activity – North Florida
Flagler Development Activity – North Florida • Construction on Lakeside Three has commenced • Completion expected in September 2007 • Lakeside One under construction and 63% leased • Lakeside Two and Four 100% occupied Lakeside Three, Flagler Center, Jacksonville, Florida
Slide 15: Flagler Development Activity – South Florida
Flagler Development Activity – South Florida • 118,296 sq. ft. under construction • Completion expected in third quarter 2007 • Second multi-tenant office building at Flagler Station • Stabilized office occupancy in South Florida 98% Office Building 1200 at Flagler Station, Miami, Florida
Slide 16: Flagler Development Group – Boca
FLAGLER DEVELOPMENT GROUP – BOCA 54 Rendering Office Depot Global Headquarters Boca Raton, FL • Build-to-suit headquarters for Office Depot, a 625,000 sq ft complex on 29 acres • J/V with TIAA-CREF Global Real Estate • Exploring opportunities for remaining 26 acres
Slide 17: Rendering – Burger King & Sevilla Buildings
Rendering – Burger King & Sevilla Buildings • Burger King Headquarters • Construction will commence in February • 225,000 sq ft build-to- suit and 23,000 sq ft retail • Expected completion late 2008 • Forward sale executed • Sevilla Building • 45,000 sq ft • Future headquarters Flagler Development G
Slide 18: Flagler Development Activity – South Florida
Flagler Development Activity – South Florida Rendering Commercebank Building Beacon Lakes, Miami, Florida • 100,000 sq. ft. build-to-suit and sale at Beacon Lakes • Commercebank ’ s Customer Service Center • Completion expected late • J/V with AMB Property Corporation
Slide 19: Florida's Dynamics are Driving Growth for Flagler
Florida ’ s Dynamics are Driving Growth for Flagler • Overall, Florida economy remains strong • Population growth is driving demand Office/retail development follow new residents Immigration remains strong • Developable land in Florida is becoming increasingly scarce Flagler well positioned for long
Slide 20: Daniel H. Popky, Chief Financial Officer
FLORIDA EAST COAST INDUSTRIES, INC . Daniel H. Popky Chief Financial Officer
Slide 21: Florida East Coast Railway
FLORIDA EAST COAST RAILWAY One of four new SD70M-2 Locomotives Delivered December 2006 New Railway Headquarters Jacksonville, FL
Slide 22: Railway Revenue Growth
Railway Revenue Growth $62.5 $63.6 ($0.7) ($0.7) $2.5 Q4 Carload Intermodal All Other Q4 Fourth Quarter - in Millions - 2.2% + 9.0% - 31.7% +1.7%
Slide 23: Railway Revenue Growth Detail
Railway Revenue Growth Detail Q4 Volume Rate & Mix Fuel Recovery Q4 Fourth Quarter - in Millions -0.7% +2.9% +0.6% +1.7% Ancillary - 1.1% ($0.4) $63.6 $0.5 $1.7 ($0.7) $62.5
Slide 24: Railway Profit Growth
Railway Profit Growth $16.3 $17.4 $21.8 $23.1 Operating Profit Operating Profit before Depreciation** **See page 38 for reconciliation of non-GAAP measures 6.9% 6.0% Fourth Quarter – In Millions * Prior year quarter includes impact from hurricanes which resulted in 14 days of limited service
Slide 25: 2007 Railway Outlook
2007 Railway Outlook Revenues Operating Profit (1) Excludes Hurricane recoveries, net of expenses, of $5.3 million Full Year – In Millions Flat - 6% 2% Decrease to 4% Increase $264.1 $265-$280 $73.1 (1) $72-$76
Slide 26: Railway Capital Expenditures
Railway Capital Expenditures Outlook $30 $27 $30 $39 (1) $42-$47 Maintenance capital Productivity & growth capital * (in millions) $45 *Before the purchase of any strategic land parcels to be used for industrial development (1)Productivity and growth capital includes $5.1 million of land purchased f
Slide 27: Flagler Development Group – Boca
FLAGLER DEVELOPMENT GROUP – BOCA 54 Rendering Office Depot Global Headquarters Boca Raton, FL
Slide 28: Flagler Rental & Services Revenue Growth
Flagler Rental & Services Revenue Growth Q4 Operating Properties Q4 Fourth Quarter - in Millions $42.1 +83.0% $3.1 $23.0 Realty Services (1) $15.8 (1) Includes construction, brokerage, property management and development revenues Land Use $0.2
Slide 29: Flagler Realty Rental Revenue Growth
Flagler Realty Rental Revenue Growth Q4 New in ’05/’06 Q4 Fourth Quarter - in Millions $25.8 +13.9% $2.4 $22.7 Same Store $0.7
Slide 30: Flagler Realty Rental Operating Profit Before D&A Growth
Flagler Realty Rental Operating Profit Before Depreciation & Amortization* Growth Q4 Same Store New in ’05/’06 Q4 Fourth Quarter - in Millions $15.6 +9.0% $1.3 $0.0 $14.3 * See page 38 for reconciliation of non-GAAP measures.
Slide 31: Realty Segment Operating Profit
Realty Segment Operating Profit $20.6 $2.8 Realty Operating Profit (3.7) (8.1) (1) Land and Overhead 0.3 0.5 Other Realty Rental 17.2 1.0 Realty Sales 0.0 1.8 Realty Services $6.8 $7.6 Realty Rental Operating Profit: Fourth Quarter Fourth Quarter - in Millions (1) Includes $1.5 million of restricted
Slide 32: Flagler Occupancy and Leasing Activity
Flagler Occupancy and Leasing Activity (1) 2003 and 2004 leasing activity represents quarterly averages. 92.5% 94.2% 95.0% 95.1% 95.2% 94.9% 94.0% 96.0% 87.2% 94.7% -10 2003(1) 2004(1) 1Q05 2Q05 3Q05 4Q05 1Q06 2Q06 3Q06 4Q06 84.0% 86.0% 88.0% 90.0% 92.0% 94.0% 96.0%
Slide 33: Flagler Lease Expirations
Flagler Lease Expirations 3,607 1,918 1,071 24.3% 13.5% 11.9% 4.7% 45.6% 2011and Beyond 0.0% 10.0% 20.0% 30.0% 40.0% Total Square Feet Expiring % of Total Portfolio
Slide 34: 2007 Flagler Outlook
2007 Flagler Outlook Full Year – In Millions Realty Rental Revenues Realty Rental Operating Profit before Depreciation & Amortization* (1) Excludes Hurricane recoveries, net of expenses, of $1.8 million in 2006 * See page 38 for reconciliation of non-GAAP measures 8 - 18% $97.4 $105-$115 Realty Rent
Slide 35: Flagler Capital Investments
Flagler Capital Investments * Excludes land acquisitions $27.0 $75.0 $80.0 $132.7 $90-$115 (in millions) $118.6 Forecast Existing Operating Properties Infrastructure Investments in Joint Ventures Acquisition New Building Construction
Slide 36: Condensed Consolidated Statements of Cash Flows
Condensed Consolidated Statements of Cash Flows 21.6 10.6 Proceeds from exercise of options - 4.7 Other - 1.4 Investment by minority interest - (11.6) Investments in joint ventures - (65.8) Acquisition of Codina Group $76.0 $ 5.1 Cash and cash equivalents at end of period 126.2 76.0 Cash and cash eq
Slide 37: Looking Forward
Looking Forward . • Florida economy remains strong • Strategic position provides strong competitive advantage • Railway management team focused on quickly adapting to customers’ shifting needs • Real estate team focused on capturing demand and maximizing property values through entitlement process
Slide 38: Reconciliation of Non-GAAP to GAAP Measures
Reconciliation of Non-GAAP to GAAP Measures $62.6 30.1 $32.5 $100.9 22.4 $78.5 $14.3 7.5 6.8 $21.8 5.5 $16.3 Q405 $15.6 8.0 7.6 $23.1 5.7 $17.4 Q406 $85.5 $67.5 $62.6 Railway Segment ’ s operating profit before depreciation $65-$69 $55.8 $44.8 $40.1 Realty rental properties ’ operating profit before
Slide 39: Questions and Answers
February 13, 2007 Florida East Coast Industries, Inc. Fourth Quarter 2006 Earnings Review Questions and Answers
Florida East Coast Industries — Q4 2006 Earnings Presentation on 6ix